Notice period

What is a notice period?

A notice period is the amount of time an employee or employer must give before employment ends. It usually starts when an employee resigns or when an employer gives notice to terminate employment. The notice period at work allows time to hand over responsibilities, recruit a replacement, and ensure a smooth transition for both sides.

Why do notice periods exist?

Notice periods help both employers and employees prepare for the end of employment.

For businesses, they provide time to:

• Recruit a replacement  

• Redistribute workloads  

• Complete handovers  

• Protect client relationships  

• Maintain business continuity  

For employees, they provide:

• Financial certainty  

• Time to search for a new role  

• An opportunity to plan their next steps  

Under UK law, employees with 12 years or more of service are entitled to up to 12 weeks' statutory notice, highlighting the importance of planning ahead when employment ends.

Types of notice periods

There are several types of notice periods that may apply depending on the situation:

• Statutory notice period - The minimum notice required by UK law.  

• Contractual notice period - A longer notice period agreed in the employment contract.  

• Employee notice period - The notice an employee must give when resigning.  

• Employer notice period - The notice an employer must provide when ending employment.  

• Payment in lieu of notice (PILON) - Employment ends immediately, with notice pay provided instead.  

• Garden leave - The employee remains employed during their notice period but does not attend work.

What is the statutory notice period in the UK?

The statutory notice period is the minimum amount of notice that must be given under UK employment law. Employers can offer a longer contractual notice period, but they cannot provide less than the legal minimum.

For employers giving notice:

• Less than 1 month of service: No statutory notice  

• 1 month to 2 years: 1 week's notice  

• 2 to 12 years: 1 week's notice for each full year of service  

• 12 years or more: 12 weeks' notice  

Employees who have worked for at least one month must generally give a minimum of 1 week's notice when resigning, unless their employment contract requires more.

What happens during a notice period?

A notice period gives both the employer and employee time to prepare for the end of employment. The employee will usually continue working as normal and receive their usual pay and benefits.

During this time, employers often:

• Arrange a handover of duties  

• Transfer client relationships and key knowledge  

• Recruit and train a replacement  

• Return company property and revoke system access  

Employees may:

• Complete outstanding work  

• Document important processes  

• Train colleagues taking over responsibilities  

• Prepare for their next role

Notice period example

Sarah is an Account Manager at a digital marketing agency. After receiving an exciting job offer, she hands in her resignation. Her employment contract includes a one-month notice period.

Rather than spending four weeks counting down the days, Sarah gets stuck into a proper handover. She updates client records, finishes ongoing projects, shares key information with colleagues, and introduces clients to the team members who will be taking over.

Meanwhile, the agency starts recruiting her replacement and redistributes some of her workload. By Sarah's last day, everyone knows what is happening, and the business continues running smoothly.

Notice period vs garden leave vs PILON

Although all three relate to an employee leaving a business, they are not the same. The key difference is whether the employee continues working, remains employed but away from work, or leaves immediately.

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Employers may use garden leave or PILON when they want to protect sensitive information, client relationships, or business interests.

Can an employee leave without serving notice?

UK Government guidance states that employees may be in breach of contract if they do not give the required notice. However, legal action is uncommon and is usually only considered where the business has suffered a significant loss.

In many cases, employers and employees agree to shorten or waive the notice period by mutual agreement.

FAQs

1. Is a notice period legally required in the UK?

Yes. UK law sets minimum statutory notice requirements, although many employment contracts include longer notice periods that both employers and employees must follow.

2. Can an employer ask an employee not to work their notice period?

Yes. An employer may place the employee on garden leave or offer payment in lieu of notice (PILON), depending on the terms of the employment contract.

3. Can annual leave be taken during a notice period?

Yes. Employees can usually take annual leave during their notice period, subject to approval and any requirements set out in the employment contract.

4. Can a notice period be shortened?

Yes. A notice period can be shortened if both the employer and employee agree. Any changes should ideally be confirmed in writing to avoid misunderstandings.